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Unused Gift Card Bill Vexing

BERLIN – Restaurants and retailers in the area sold thousands of dollars in gift certificates and gift cards during the holidays, a fair amount of which might never be used, but a bill introduced in the General Assembly this week could require the sellers to send a large portion of the revenue back to the state.

House Bill 126, introduced this week by Delegate Joseline Pena-Melnick (D-21) and co-sponsored by over 60 of her colleagues, would consider the unused balances and gift cards and gift certificates sold in Maryland abandoned property and could force the sellers to remit as much as 70 percent of the unused money back to state. According to the bill, unused gift certificates and gift cards would be presumed abandoned if not used within four years of their issuance.

The bill, if passed, would require the merchants who sell gift cards and certificates to provide the state Comptroller’s Office with a detailed list of how many they sold and for what amounts. For those certificates and cards presumed abandoned under the aforementioned conditions, the merchants would be required to remit 70 percent of the total to the state, which would revert the money into its general fund.

Local business leaders this week scoffed at the attempt to force merchants to turn over the money collected for unused gift cards.

“From my understanding of the bill, it seems a little ludicrous the state is trying to reach further into the pockets of the restaurants and retailers to claim a share of unused gift card and gift certificate money,” said Ocean City Hotel-Motel-Restaurant Association Executive Director Susan Jones. “It seems absurd that government would try to do that. If the cards or certificates go unused, that’s not the fault of the restaurants or the retailers, yet this would penalize them.”

Restaurant Association of Maryland (RAM) officials are strongly opposed to the legislation.

“As the state continues to tackle their fiscal woes, it is now reaching for any possible source of revenue it can find,” said RAM’s Melvin Thompson this week. “We have a problem with this for a lot of reasons, not the least of which is the requirement the sellers of gift certificates would have to remit a large portion of the money for unused cards and certificates to the state.”

No less troubling for many is the stringent bookkeeping element required by the legislation.

“The bookkeeping aspect of the bill seems rather onerous,” said Jones. “This would be a full-time job keeping track of who bought what gift certificates and for how much and when and if they were used.”